Brazil faces hurdles in renewable energy and transport decarbonization

Brazil's renewable energy sector is experiencing a slowdown in new wind and solar projects. Despite the country's potential for energy transition, high interest rates, regulatory uncertainties, and an excess of energy in the electrical system—leading to compulsory cuts of up to 30%—have hindered development. Projections from Abeeolica and Aneel indicate that new wind power capacity entering operation is expected to reach only 1.26 GW, a significant drop from the 4.8 GW record set in 2023. Solar energy growth is also expected to slow to 13.2%, compared to average annual increases of over 50% in recent years.

In the transport sector, decarbonization efforts face an impasse between companies needing cleaner technology and infrastructure providers requiring consistent demand to justify investments. One proposed solution is the creation of ‘green corridors’—structured routes equipped with necessary refueling or recharging infrastructure. Experts suggest that successful implementation requires collaboration between transport companies, energy suppliers, and the public sector to plan routes and establish incentives, particularly given Brazil's continental dimensions.